The European Union is expected to hit the capital markets in the next few weeks with a plan to raise EUR2-2.5bn by the end of July, banking sources close to Triple A rated issuer said on Monday.

The EU was not expected to return to bond markets until September after it completed a EUR4.5bn fund raising target in May. A new bond issue, therefore, would be earlier than many market participants had anticipated.

The banking sources said that the EU is expected to send a request for proposals (RFP) by the end of this week to banks, with the aim of selling bonds with a maturity of 10-15 years.

Its previous deal - a EUR2.7bn 10-year bond which printed in May at mid-swaps plus 56bp - was used towards the aid package for Portugal. That bond has since tightened to 48.1bp over mid-swaps, according to Tradeweb.